Reports that Britain faces another big freeze this winter may have depressed commuters, but they will have put a smile on the faces of soup suppliers hoping for a repeat of last year's solid performance.
While market penetration has remained static over the past year at nearly 90%, shoppers have bought soup more often and spent more per trip, helping the total category grow 9.1% to £562m [Kantar Worldpanel 52w/e 7 August 2011].
They have been lured by a wealth of exciting NPD both in the ambient and fresh arenas. On the branded front, July saw the launch of Heinz Squeeze & Stir, the first soup in a purée format. Sold in individual sachets (rsp: 59p), the soups are designed to be squeezed into a cup and mixed with boiling water. It has clearly struck a chord with its target lunchtime audience, taking a 6% share of the instant soup market [Nielsen 4w/e 17 September 2011], making Squeeze and Stir the third-largest brand in the sector [Heinz].
Rival Campbell's responded by adding new ready-to-serve soups to its range this month (see page 57), following the relaunch of its iconic Condensed soups. In the own-label market, Sainsbury's relaunched its chilled soups, revamping core lines and introducing six meal soups containing two of the recommended five-a-day, and this month Tesco turned up the heat with its latest venture brands The New York Soup Company, a five-strong range including Chicken Jambalaya and Sweet Potato and Blackeyed Bean variants.
That the retailers are focusing on chilled is no surprise given the sub-category's impressive growth over the past year. Chilled soup sales have shot up 11.2% in value and 10.8%% in volume [Kantar], with up-and-coming brands such as Glorious! setting the pace. But with consumer spend under ever-increasing pressure, chilled with its predominantly premium price tags is by no means the only show in town.
While some ambient brands, notably Batchelors and Baxters, have fared badly over the past year, wet ambient soups in general have held up well, with volume growth of 1.6% and value growth of 6.9% off a high base. Dry ambient soups, meanwhile, have actually outperformed chilled, with 14% value growth and 12.5% volume. Hitting the right price points is obviously key, but NPD also appears to be winning over consumers, especially if it has a healthy eating focus.
Glorious! Skinny Soup, launched last May, has already racked up £4m of sales [Kantar 52w/e 4 September 2011]. While performance was buoyed by a promotion that coincided with the cold snap in January, sales growth continued to outpace the total soup market long after temperatures returned to normal, soaring 217% year-on-year from June to 4 September.
Glorious! marketing manager Matthew Stephenson attributes the brand's success overall sales have risen 58.8% to £8.6m [SymphonyIRI 52w/e 3 September 2011] to its ability to resonate with younger consumers with more exciting flavours. "Trade tends to err towards traditional high-volume lines and how they can promote them, whereas we're looking at what's adding incremental value and attracting consumers to the category," he says. "The choice is still not there for younger consumers looking for something a bit different."
Fellow chilled brand New Covent Garden Soup Co is also targeting a younger audience and lunchtime workers with its 99-calorie soups, launched into Sainsbury's last winter and extended into Tesco this year. NCG says sales of the range have already hit £1m, although the performance of the overall brand has been sluggish rising just 1.9% year-on-year [SymphonyIRI].
This is perhaps no surprise given the challenges facing the long-established brand. Its future ownership is uncertain ('Daniels in 'advanced negotiations' over sale', 1 October, p8) as publicly listed global foodservice company Singapore Airport Terminal Services looks to offload the brand's parent Daniels Group, and a temporary delisting at Tesco following pricing issues dented the brand's summer sales. However, the dispute has now been resolved and an additional 1,000 distribution points with the retailer secured. NCG has also won more shelf space with Asda, Morrisons and Sainsbury's.
Marketing director Nigel Parrott says he is confident about the brand's prospects this winter. But like other chilled brands, NCG faces stiff competition from ambient competitors. Campbell's returned to the soup aisle in January with a range of cup soups developed with Leeds-based Symington's. In August, its iconic condensed soups immortalised by Andy Warhol reappeared after a three-year hiatus. Seven condensed soups (rsp: 82p/295g) were launched, all of them created specifically for the UK market. The brand's value sales are up a whopping 241.8% year-on-year to £4.1m [SymphonyIRI] thanks to "significant dry soup R&D" says Symington's marketing controller David Cherrie.
Another brand focusing on healthy NPD, but this time from an ambient perspective, is Baxters, which launched its five-strong Stay Full range of soups in July in the hope of reversing a 5.2% year-on-year value slump [SymphonyIRI]. Premier Foods is also targeting healthy eaters with its new High Veg a Soup lines, launched in July, and has overhauled its wider Batchelors Cup a Soup range in an attempt to improve the brand's fortunes after a 7.7% fall in value to £53m [SymphonyIRI].
Dry ambient has become increasingly popular a 3.5% increase in the number of shoppers over the past year means that 51.9% of the population now buys into the category. The number of trips to buy dry ambient has also grown by 5.9%, according to Kantar.
There's no denying that soup has had a good year, rich with innovation. But what of the next 12 months? The brands will have their work cut out for them if they want to maintain the excitement we've seen in the category this year.
Focus On Soup